Aztar to redeem notes

Tuesday, March 9, 1999 | 10:25 a.m.

Aztar Corp. said it will redeem $75 million of its 11 percent senior subordinated notes due 2002 on April 7 this year at 101.571 percent of face value plus accrued interest.

The redemption will be paid with funds available through Aztar's revolving loan agreement, which has a current interest rate below 6.875 percent.

The redemption will leave Aztar with $125 million of 11 percent senior subordinated notes due 2002 outstanding. Aztar also has $180 million of 13.75 percent senior subordinated notes due 2004 outstanding; those are calleable next Oct. 1.

Aztar's announcement said its bankers have agreed to let the company increase to $205 million the amount of subordinated debt it may redeem with the revolving credit facility, indicating it may call a portion of the 13.75 percent notes after Oct. 1 if interest rates remain low.

The company said the $75 million of note redemptions is the first step in its plan to cut interest expense and increase financial flexibility. The company said it "continues to monitor capital markets and evaluate its alternatives with respect to the refinancing of its senior subordinated debt."

Aztar operates the Las Vegas and Atlantic City Tropicana hotel casinos and other properties in Nevada, Missouri and Indiana.